Los Angeles Judge Says Netflix, Hulu Don’t Owe Franchise Fees


Partner, Stephen Kranz is quoted in Tax Notes.

“While suits seeking to tax streaming companies under existing laws all have their own unique features, “there is a clear trend-line across the country of judges dismissing the attempted lawsuits on behalf of plaintiff cities seeking franchise fees,” said Stephen P. Kranz with McDermott Will & Emery. He argued that those fees are meant to apply to entities that build infrastructure, such as fiber-optic telecommunications networks, and not to entities that merely transmit information over the internet. He said cities that want to tax streaming services should pass or seek authority to pass new levies rather than applying existing fees that weren’t designed with streaming services in mind.

“If you’re going to do it, do it right, and that means pass properly enabled legislation,” Kranz said. “